Location-based services on the move

The US generated 81 per cent of the world's location-based services revenue in 2007

Location-based services are shifting away from North America to Asia and Europe, new research reveals.

A report from ABI Research suggests that the US generated 81 per cent of the world's location-based services (LBS) revenue in 2007, but will drop to just 32 per cent by 2013.

In the same period, Western and Eastern Europe's combined LBS revenues will jump from just five per cent to 31 per cent, and Asia-Pacific will see a rise from 11 per cent to 27 per cent.

"LBS are not a zero-sum game," said ABI Research principal analyst Dominique Bonte.

"It is not that Americans will lose enthusiasm for LBS. These changing shares just reflect the fact that a market which for technical reasons has been largely restricted to North America will finally grow strongly in other regions."

Bonte believes that the slow uptake of LBS outside North America is largely down to GSM handsets owned by most users in Europe and Asia not generally offering native GPS support, unlike the CDMA phones which are prevalent in the US.

However, with the broader proliferation of GPS-enabled GSM handsets in other regions, and the quickening rollout of 3G services worldwide, the opportunities for LBS offerings will grow rapidly.

"Since most LBS application developers sell to the world, and most of their products are platform-agnostic, the cost per service for users is likely to be similar in all regions," added Bonte.

"However, a navigation service can cost as much as $9.99 a month, whereas friend-finder services might only be $2.99.

"On that basis, as well as via cultural preferences, particular services will be popular to differing degrees in different regions. This will affect the total revenue to be generated from a particular region."